Bay City raises water rates, lowers sewer charge

Bay City is increasing its water rates for residents.
Bay City is increasing its water rates for residents.
Published: Jan. 19, 2023 at 4:36 PM EST
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BAY CITY, Mich. (WNEM) – Bay City residents will see an increase in their water rates starting next month.

The Bay City Commission approved the hike this week along with approval of an ordinance lowering a sewer commodity charge.

The water usage is measured in cubic feet or CCF. One hundred cubic feet (1 CCF) is equal to 748 gallons of water.

“For every 748 gallons we provide to customers, we [will] charge them $4.51,” said Bay City Fiscal Services Director George Martini.

Currently, the cost per 748 gallons is $4.24. The 27 cents increase starts on Feb. 1.

Martini said the city consulted with Utilities Financial Services for over a year to determine the rate increase.

He said with the exception of rate hikes due to the purchase of water, the city has not had many increases.

“As their [water supplier] prices have gone up, we’ve gone up by that same amount. We have not really done any rate increases to provide more operating costs or more operating revenues for the city,” Martini said.

Buying water, operational cost, capital outlay for improvements such as lead service line replacements, and water main replacements were some of the factors in determining the increase.

Water rates will increase to $4.51 on Feb. 1, 2023, $4.98 on Feb. 1, 2024 and $5.48 on Feb. 1, 2025.

The sewer commodity charge will decrease to $7.95 on Feb. 1, 2023, $7.38 on Feb. 1, 2024 and $6.83 on Feb. 1, 2025.

The sewer charge decrease is facilitated by the completion of a bond that residents will have paid back on April 1, according to Martini.

The bond, issued in March 2001, was related to “extensive improvements to the City’s Wastewater Treatment Facilities,” and was in the amount of $42,435,000 from the Michigan Municipal Bond Authority.

“To basically account for a significant reduction in debt service in the sewer fund, we reduced the sewer funds or the sewer cost at a rate that is just about equal in the water rates, so the actual increase to the customer for somebody who has a water and sewer account with the city, is going to be very, very minimal,” Martini said.

The city made its estimates based on a resident who uses 7 CCF on average per month.

“The average cost, I believe, is going to increase the total bill by approximately 35 cents per month or .3 of 1 percent, so it’s really almost a wash,” Martini said.

The rate increase will also generate roughly $270,000 for the city’s water fund.